Barclays is set to fight a potentially record $470m penalty from U.S. energy regulators by arguing its traders were guilty of braggadocio, not of rigging California electricity prices.
Reuters reports that the four traders in question, who boasted in emails and instant messages about how 'fun' it was to 'crap on' certain physical power prices, did not actually carry out the complex scheme they are accused of by the Federal Energy Regulatory Commission, a source familiar with the bank's thinking said.
Last week, the country's top cop overseeing electricity markets ordered Barclays to demonstrate why it should not pay a $435m civil penalty, plus $34.9m in the repayment of ill-gotten gains, for manipulation of California power markets between 2006 and 2008.
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Analysis: Barclays set to fight FERC over bragging, not rigging